The New South Wales government has officially launched its biggest ever renewable energy tender, along with a new call for long duration storage that it says is critical to “keep the lights on” and push prices down as the last of its coal fired generators exit the grid.
The tender – as flagged by Renew Economy last week – will seek 2.5 gigawatts of new wind and solar capacity, with a special emphasis on wind and solar-battery hybrids that can push the output outside of daytime periods when rooftop solar dominates the grid.
Another 12 gigawatt hours of long duration storage is also being sought – from batteries and pumped hydro – to make sure supply is maintained and dispatched when demand is high or when weather conditions are not ideal for renewables.
“This is the largest renewable generation tender in NSW history, and it shows just how serious we are about delivering cheaper and more reliable power for households and businesses,” state climate and energy minister Penny Sharpe said in a statement.
“Tender 8 alone will deliver enough energy to power about one-third of homes in NSW, marking a major step forward in our plan to future-proof NSW’s electricity system.
“Tender 9 ensures we can store renewable energy, so it can be released on demand when needed, making our grid more stable and reliable.
“This is about keeping the lights on when ageing coal-fired power stations retire and doing it in a way that puts downward pressure on electricity bills for NSW families.”
One of the features of the new generation tender is a specially designed LTESA (long term energy services agreement, a kind of underwriting arrangement) for solar-battery hybrids, which have become the new go-to technology in the grid.
These projects are able to largely dodge daytime negative prices because solar (or wind for that matter) can be stored on site, rather than curtailed, and fed into the grid when needed most.
See our story: Coal state’s biggest renewable tender to focus on power delivered when the sun don’t shine
The batteries must not be bigger in capacity than the solar (or wind) farms they are being built next to, and must also have at least four hours of storage.
This is the first generation tender to be held by NSW for several years, as it paused its program while it filled its quota from the federal government’s flagship Capacity Investment Scheme.
Sharpe says the winners of this tender will take NSW to 90 per cent of its targeted 12 GW of new renewable capacity by 2030 – assuming they all get built on time as required. It is expected another 2.5 GW tender will be launched later this year.
The state currently has just one wind farm under construction, despite a lengthening queue of big projects waiting to reach financial close. Further holdups will put pressure on the state to strike more deals to push back the closure dates of coal fired power generators, as it has done with Eraring, the country’s biggest.
Nevenka Codevelle, the CEO of ASL, which manages the state and federal tenders, says the wind and solar-hybrids, particularly those whose bids account for network related risks, additional costs such as infrastructure upgrades, and which take into account potential near-term and temporary curtailment losses.
“As we approach 2030, our focus is supporting projects that can get financed and built,” she said in a statement.
“Proponents that demonstrate their ability to bring capacity to the network on schedule, and bid competitively for the support they need to reach financial close will be well placed in this process.”
The tenders open on Wednesday and proponents have seven weeks to make their offers. The results of the tenders are expected to be determined before the end of the year.
If you would like to join more than 29,000 others and get the latest clean energy news delivered straight to your inbox, for free, please click here to subscribe to our free daily newsletter.
If you wish to support independent media, and accurate information, please consider making a one off donation or becoming a regular supporter of Renew Economy. Please click here. Your support is invaluable.
Giles Parkinson
Giles Parkinson is founder and editor-in-chief of Renew Economy, and founder and editor of its EV-focused sister site The Driven. He is the co-host of the weekly Energy Insiders Podcast. Giles has been a journalist for more than 40 years and is a former deputy editor of the Australian Financial Review. You can find him on LinkedIn and on Twitter.
Share this:
Facebook
X
LinkedIn
Reddit
Email
Print